Crud. And they don’t freeze it once you attend. There goes an option.
Thanks for sharing this. Yes, they have been bouncing around this idea of increasing OOS tuition for a couple of years. If they cap it, as the articles suggests, at around 5.5% per year for those OOS “already enrolled,” it is still (at least for those students) a pretty good value compared to other Big Tens. Tuition at many schools increase annually by more than that anyway. Not to minimize it, in fact my kid’s decision to go to UM (she was accepted to CLA/Honors College recently) will definitely be impacted by this. I wonder if the proposed “cap” will apply to those entering next fall 2016 (Class of 2020), but I guess it will depend on how fast they can implement the change…
That would eliminate this school for my already accepted daughter.
@ThirdDegree your question certainly merits a question to Admissions. I read that Kahler’s comments applied to students who have already begun their studies at UMN. Unless it has released next year’s tuition (and I don’t think it has) then one can possibly expect this to go into effect beginning fall 2016.
Again, worth asking.
I assume if a student has the Gold National Scholarship as OOS this does not affect them because the scholarship waives the difference between IS and OOS tuition.
This will definitely impact how many OOS students apply next year and enroll for 2016. It will be interesting to see how they plan on getting the high stats kids to apply/enroll, especially in CSE where the incoming stats are really high now because they are getting the additional high stats from outside of Minnesota.
Article says UMN slashed OOS tuition in 2008, look at how CSE stats have risen since then:
http://www.oir.umn.edu/student/characteristics/term/1159/trend/10034
http://www.oir.umn.edu/student/characteristics/term/1159/trend/10004
For CSE and maybe Carlson, I think the thought is they are on par with Michigan and UIUC now. See this quote:
“I think being at the bottom, in terms of sticker price, hurts us,” said Regent Michael Hsu. “We’ve got to be concerned with our brand. … Otherwise, we’re talking about Lexus and Toyota. And we’re Toyota.”
Price does send a message, unfortunately. Learned that in my Grad Marketing class when learning the 4Ps. 
How much do we think this will affect high OOS stats kids applying and then enrolling?
@mamelot You are a good sounding board for this. What do you think?
Mamelot: you may well be right about it applying to Fall 2016, but I think (perhaps wishfully) the proposed OOS tuition increase so far is just that, a proposal. As I mentioned, they’ve been talking about this for some time. In any event, it would be sort of unfair to apply the full proposed 15% annual increase to those who already applied and are accepted (and who timely enroll) for Fall 2016, but I guess we’ll see. No idea to what extent this increase will affect other OOS kids with high stats, but it certainly can’t help.
@CyclonesGrad I don’t think it’ll impact admission at all as the application is very easy and OOS kids will probably still get a fee waiver. And a good number of those kids will get the Gold National, of course.
It will negatively impact OOS enrollments but as Kaler mentions we don’t yet know the “elasticity” of the price increase. If relatively inelastic, then the revenue increase will more than compensate for the enrollment decrease. If relatively elastic, the opposite will occur. We will see one way or the other because I think this is going to happen. @ThirdDegree is correct that they have been talking about this for some time but this came out under the president’s authority (read: approval by the trustees as well) and with a press release. That tells me it’s a settled issue among the highest echelons. The “proposal” is likely just to get some real feedback from anyone within the school or at large in the state who hasn’t yet had an opportunity to provide it. I’m not sure who that would be other than the OIR guys and as Kaler mentioned we don’t yet know the elasticity. The state citizenry isn’t going to have an issue with this, and the legislature wants them to go farther and lower in-state tuition. So I don’t see many obstacles. Out-of-state families who don’t qualify for scholarships won’t be pleased but it’s still the best deal in town for now - just less so. Kaler might know something about or be counting on expected OOS increases for other Big 10 universities.
@ThirdDegree I don’t know what they will do about the OOS class of 2020 kids who are already enrolled (there have to be some at this point). If I were one of them I’d offer some feedback very quickly!
@mamelot You are right that it will not impact applications but will impact enrollment. I don’t know if you remember that we discussed this at length last July when we were going to visit. This increase does not come as a surprise to me. Agree that this is a done deal.
This increase will just put them on par with Iowa, UIUC, and Ohio State as will surely have tuition increases over the next four years. I think the message is also that they consider themselves an upper echelon university.
Interesting question on how they will handle 2020 students who have enrolled believing that the tuition will be close to todays level.
It will be interesting to see what ISU does in response. Their OOS tuition is on par with current UMN tuition and much lower than Iowa. It will be interesting to see if they raise OOS in response or if they may get a significant amount of high stat Illinois kids going there by holding. What do you think is going to happen regarding CSE students? @mamelot Thoughts?
Who thought higher education could be so intriguing from a marketing/economics point of view? I love the elasticity of demand discussion!!! :)>-
Obviously, higher education is “non-profit” with a lot of the profit components taught in Business School and lived in industry. Obviously a high stakes game!!! 
@CyclonesGrad I do remember that conversation very well.
I don’t know how good of an economist Kaler is. I do know that he is a chemical engineer so would have a connection to CSE and for a variety of other reasons I doubt he neglected to get input. CSE, after all, would likely have the highest % of admissions from OOS of any of the colleges. There might be something going on with that college beside pure price effects. If, instance, a good number of CSE admits are choosing more expensive private colleges, then price obviously wasn’t a factor in their decision. There may be differing elasticities for the different colleges. I would guess that the more select the college, the less price elastic.
I just calculated that “other US” accounts for less than 15% of enrollments of incoming freshmen overall. International adds another 5 - 6% (not sure how their tuition is calculated and they are a different market altogether). The primary state other than MN is WI and they aren’t affected by this. I don’t think the overall impact is going to be that great.
Love Kaler’s timing too - Two Fridays before Winter Break and right before the Priority Deadline. The majority of apps are in right now, and families will be looking at FAFSA come January. Perfect time for them to begin to assess the impact on enrollments right away. Guessing they start to get quite a lot early in the new year.
@mamelot S2 has scholarships from ISU that make Tuition/Fees/R&B at $16K. UMN gave him Gold National which puts him at $22.5K.
The real question is: Is UMN is worth $6500 more per year than ISU? The schools are very closely ranked for engineering and both are members of Association of American Universities (elite group of 60 research universities).
http://www.aau.edu/about/default.aspx?id=16710
For S2, the cost for UMN will need to be closer to ISU for him to consider going there because he is going into Chem E. D2 has the same costs but she wants to do BioMed E (even though I have suggested ME with BioMed minor at ISU) and ISU does not offer and UMN does. She also received the Gold National so she will probably end up at UMN.
ISU is currently the last holdout in the Midwest regarding low OOS tuition.
BTW, UIUC IS cost is $31K (tuition/fees/R&B) for engineering!!! That is what is driving so many kids out of IL to UMN and ISU. There is also a huge outcry about that here in IL.
@CyclonesGrad you’ve looked into a number of factors to compare CSE to ISU (College of Engineering). It’s not an easy problem to solve. The only thing I’d add is that current salaries for chemical Engineers may be influenced by fracking so it might make sense to take a longer or broader look (history of salaries, job categories for chem. engineers that are NOT fracking-related, etc.). I’d try to figure out the admission rate for each college as well, if possible.
Isn’t ISU one of the Big 10? How come I don’t see it on that list in the article?
University of Iowa is in the B1G, not Iowa State. They are in the Big 12 I believe…hard to keep track of conferences these days.
Well, I was shocked to find that RUTGERS was in the Big 10. When did that happen?
Thanks for the info, @2muchquan
@2muchquan You are correct. ISU is in the Big 12. That is why they are not on the list of B1G schools.
@mamelot Long term, Chem E has always been near the top of BS Eng salaries. That includes when I graduated in 1982. Fracking is a small percentage of graduates from ISU or UMN. Much more heavily concentrated at UT, UT A&M, Texas Tech. ISU is heavily recruited by refiners, chemical companies, and some pharmaceuticals.
Just learned today my D received the Gold National Scholarship for Fall 2016, so we are basically looking at in-state tuition, or in that ballpark. Not sure if this moots my concerns about large OOS tuition increases.
Good luck to you all.
Congrats to your D, @ThirdDegree! UMN would be lucky to have her!
There goes this school from S2’s list…
This may put Minnesota out of reach for us… sadly it’s my daughter’s first choice but I don’t see how we can swing it.
A lot of public schools are raising their out of state tuition in order to supplement the funding that the state does not want to give. Now, I am not an economist but I wonder how is this sustainable? Are they so many rich student that will go around supporting every other state’s public school? I do not know. I am aware of a few neighboring state schools that have super high tuition but in reality they do give a lot of merit. Last year it seems that every student from our high school that went to a neighboring state public school with 50K tuition got 15K off. So realistically that school costs 35 and not 50. That is still 10K more than our instate tuition but that is a price that people are willing to pay. So it is not like you raise your tuition X and then you multiply the number of OOS with it as politicians make you believe. Besides I was reading a couple of articles on line that said that this method changes the school’s character and it becomes more like a private school which ultimately is not what instaters want. As I said, not an economists but some things just don’t add up. And it is kind of funny that every state that goes this way is referencing Michigan.